Introduction
Reverse logistics is required after the customer receives the product for operations such as exchange and reuse. Prajapati et al. (2019) argue that this system is involved in rescuing used products and recovering a percentage of their original value in terms of activity. Reverse logistics has become profitable because it reduces the cost of returning goods, improves customer service, increases corporate profits, improves sustainability, and enhances consumer satisfaction. This work was written with the aim of studying the sphere of reverse logistics.
State-of-the-Art Reverse Logistics System
Reverse logistics starts at the supplier and moves downstream to the reseller or manufacturer through the supply chain. This entails operations such as recycling, refurbishment, and remarketing, in which the finished product is responsible for the final disposal of the item. Companies use reverse logistics, where goods are returned through the distribution network to the supplier or possibly back to the suppliers after reaching the final destination. Recovering or recycling the value of a product is the primary goal of efficient reverse logistics systems (Prajapati et al., 2019). The technique has been adopted by a wide range of businesses, including intelligent firms, who use it to increase customer loyalty and retain them when revenues decline.
Support of Claims
When people wait until the end to send something back up the supply chain, transportation and storage costs are likely to be high. Refunds have become more common due to e-commerce, so these costs will also start to improve after a while (Gupta, 2013). Building and executing a diagnostic tool to quantify this effect fully can show how better reverse logistics management can reduce overall costs by lowering quality costs. The management of internal reverse logistics is also adequately considered (Prajapati et al., 2019). The engine of the diagnostic tool is procedure-oriented with cost functions for certain activities.
Reverse logistics is an effective means of providing quality customer service. When a customer has problems returning an item, the customer experience tends to suffer. Industry analysts estimate that up to 50% of businesses today do not have a written strategy or structure to enable and manage returns (Gupta, 2013). If a client is dissatisfied with the shares the company has sold to him, the clients will become even more dissatisfied if there is no way to solve the problem. Similarly, if someone wants to solve a problem but has not yet implemented the necessary procedures, it will take some time to get a response (Govindan & Bouzon, 2018). The reverse logistics strategy allows the corporation to respond by providing an adequate service.
Repair logistics can boost profits despite the benefits of returning obsolete products from customers and protecting a brand over rejecting returned products. This strategy entails repurposing the returned item and selling it for a specific purpose. A perfect example is mobile phone upgrades that users return because they want to buy new products. The returned phone can be repaired and resold to other potential customers looking for a cheaper option. As a result, it will be possible to expand the market penetration and serve more customers (Govindan & Bouzon, 2018). Instead of disposing of the returned goods, the organization’s profit increases significantly.
Benefits
Efficient reverse logistics can improve the sustainability of a company along with the benefits listed above. Reverse logistics is more than just a return management method. It is also an environmentally responsible approach to the collection and reuse of products and components after a product’s life cycle. It can also add “green” to the total in several circumstances. The government will have a certain percentage of processed food in its products by law.
After the product’s expiration date, it includes the recycling and reuse of the components contained in the formulation and its packaging. In many cases, open dumping or incineration of used goods or methods is no longer possible. Reverse logistics use recycling, material recovery, reuse, and remanufacturing instead of sanitary landfills or cremation (Sirisawat & Kiatcharoenpol, 2018). The suggested model for planning, evaluating, and managing life cycle resource consumption provides a method for identifying project difficulties related to organizational structures, responsibilities, and relationships and integrating the sector.
Companies can create tailor-made methods for customers using intelligent reverse logistics technology. Companies can better control their inventory after understanding the requirements of their customers. They can also reduce the chance of lost shipments or delayed delivery of products. The use of smooth reverse logistics procedures will increase production and reduce the wastage of resources. The overall costs of the company will be significantly reduced due to adequate processes for the virtual use of returned goods.
Research
Efficient reverse logistics can help a company gain customer data, increasing its knowledge of the market it serves. Customer satisfaction and cost reduction are facilitated by streamlining the procedures for what happens to items after they are delivered. Product data collected from post-delivery communications with customers is helpful for logistics management (Govindan & Bouzon, 2018). The data provides insight into the logistics system and opportunities to improve products and customer service. Undoubtedly, effective reverse logistics can provide an organization with vital customer data that can help it improve service delivery and customer experience.
Life Cycle
Life cycle modeling can facilitate environmental studies based on the above benefits, such as creating an environmentally friendly environment because it analyzes the life cycle processes that exchange materials, substances, and energy with the ecosphere. In addition, modeling the system helps to reduce its complexity, which may be related to the required resources. Reducing the need for resources leads to low costs in the production process, which ultimately increases the firm’s profitability. As a result of reduced complexity, customers will understand the product faster, contributing to efficient customer service and customer satisfaction.
Support or Contradict
While reverse logistics can be beneficial in various ways to return goods, it also has a tricky aspect where retailers do not acknowledge that customers are returning goods. Since there are return clearing systems, sellers may not know the refund until it is in stock. While refund processing systems exist, retailers may not be informed of refunds until they arrive at the warehouse. Since many merchants have yet to combine multimodal purchasing with reverse logistics management successfully, this incident puts firms at a disadvantage (Sirisawat & Kiatcharoenpol, 2018). In addition, firms must figure out how to handle returned goods.
Biblical Perspective
The concept of supply chain management can be found in the Bible. It is worth noting that supply chains occurred even in the times of the Old Testament, but it appears that the good Lord Himself maintained the stranglehold on the supply of all commodities and resources back then. There were various instances in the Bible when logistics and supply chain management were applied, and there are passages to demonstrate the need for logistical abilities during ancient times.
Conclusion
Inconclusively, customers may return purchased items that a business has already supplied to them. With an effective reverse logistics system, the organization can reduce costs, increase its profitability and become eco-friendly as the plan outlines ways of reusing the returned goods. Through product life cycle modeling, reverse logistics can further lower operations’ complexity, especially on resource usage. Nevertheless, retailers may fail to appreciate that goods are being returned to the manufacturing, posing a challenge to applying the reverse logistics system.
References
Govindan, K., & Bouzon, M. (2018). From a literature review to a multi-perspective framework for reverse logistics barriers and drivers. Journal of Cleaner Production, 187, 318-337.
Gupta, S. M. (Ed.). (2013). Reverse supply chains: Issues and analysis. CRC Press.
Prajapati, H., Kant, R., & Shankar, R. (2019). Bequeath life to death: State-of-art review on reverse logistics. Journal of Cleaner Production, 211, 503-520.
Sirisawat, P., & Kiatcharoenpol, T. (2018). Fuzzy AHP-TOPSIS approaches to prioritizing solutions for reverse logistics barriers. Computers & Industrial Engineering, 117, 303-318.